Kenya has received assurances that Washington will ratify two crucial trade deals before the US presidential election on November 5, the trade ministry told parliament.
US lawmakers will approve the extension of the Africa Growth Opportunity Act (AGOA) and the US-Kenya Strategic Trade and Investment Partnership (STIP) agreement, Chief Secretary for Industry Juma Mukwana told the National Assembly’s Ministerial Committee on Trade, Industry and Cooperatives.
Kenya is seeking to extend AGOA, which was first approved in 2000 before being renewed for 10 years in June 2015. The agreement is set to expire next year, with President Joe Biden’s administration keen to extend it until 2041.
The agreement provides duty-free and quota-free access to the United States for thousands of products such as food, beverages, lumber, plastics and rubber from sub-Saharan Africa, but Kenya has largely exploited the clothing line.
“The AGOA extension bill is currently before the US Congress. We have very good relations with the US and we are confident that AGOA will be renewed before any change in government in the US,” Dr. Mokwana said.
“This is in the US Congress and we have been assured that before October the AGOA bill will be completed.”
The current trade negotiations are being led by a Democratic administration, and there are concerns that a potential change in government — to a Republican administration — could upend the agreements.
Dr Mokwana told MPs that the government had also received assurances that the science and technology investment agreement would be concluded and signed before the exit of President Joe Biden’s administration.
“AGOA and the Investment and Technology Agreement will be renewed and signed respectively. We understand that a new government will take power in the United States,” he said.
Dr Mokwana appeared before the committee accompanied by Abubakar Hassan, Chief Secretary, Investment Promotion, to brief MPs on measures being taken to boost Kenya’s manufacturing sector.
The committee chaired by Embakasi North MP James Gakowya also wanted to know what measures the government is taking to enhance value addition and diversification within key manufacturing sectors, support SMEs and cottage industries, as well as measures to address infrastructure shortcomings and high cost of production that are hampering manufacturing productivity.
Kenya is racing against time to conclude two crucial trade deals with the United States to avoid being thrown back to square one if Republicans take power in Washington.
The United States is scheduled to hold presidential elections on November 5 this year, with Vice President Kamala Harris of the Democratic Party competing against former President Donald Trump of the Republican Party.
The US Congress has introduced proposals that would extend AGOA until 2041, so it would remain in effect for 16 years.
In April of this year, Senators Chris Coons (D-Del.) and James Risch (R-Idaho) introduced the AGOA Renewal and Improvement Act of 2024, which would extend AGOA to 54 of the previous 32 African countries.
This expansion is expected to integrate AGOA with the African Continental Free Trade Area to support the development of supply chains within Africa.
Kenya has long sought a full and sustainable free trade agreement with the United States outside the two-decade-old AGOA, but progress has been stalled by regime change in both countries.
The two countries are negotiating under the Science and Technology Investment Plan, the terms of which Kenya and the United States began drafting in July 2022, before the end of former President Uhuru Kenyatta’s term.
The eleven chapters focus on agriculture, anti-corruption, digital trade, environment and climate action, good regulatory practices, and micro, small and medium-sized enterprises.
The Africa Science and Technology Investment Plan was supposed to be a “high-level commitment” in a wide range of areas with the aim of increasing investment, promoting sustainable and inclusive economic growth, benefiting workers, consumers and businesses and supporting African regional economic integration.
The Investment, Technology and Innovation Plan was also supposed to address workers’ rights and protections, women’s, youth’s and others’ participation in trade, cooperation on standards, trade facilitation, customs procedures, and regulation of domestic services. Kenya and the United States held the seventh round of negotiations on August 5 under the Investment, Technology and Innovation Plan, where eight chapters were discussed. The negotiations are co-chaired by Assistant U.S. Trade Representative for Africa Constance Hamilton and Kenya’s Principal Minister of Trade Alfred Kombodo.